First of all, Happy Chinese New Year! May the year of dragon brings lots of joy and prosperity to all of us. The topic today is about finding a legitimate financial planner.
Financial planning is a regulated activity. Only those registered with the relevant authorities are allowed to carry on the service of financial planning. However, there are many people who claim to be financial planners. How do you verify their legitimacy?
In this article, we will see the ways to verify a financial planner.
Types of financial planners
Financial planning can be conducted by two types of licensed persons. With the licence, they are able to provide solutions from multiple financial institutions, hence giving you more choices at one place, rather than going to different providers.
1. Financial Adviser’s Representative (FAR)
A FAR is registered with Bank Negara Malaysia (BNM) and holds the Financial Adviser’s Representative Licence (FAR License). They generally deal with insurance.
2. Licensed Financial Planner (LFP)
A LFP is registered with Securities Commission of Malaysia (SC) and holds a Capital Market Service Representative Licence (CMSRL). They generally deal with investment.
A LFP is also registered with the Federation of Investment Management Malaysia (FIMM). This allows LFP to market and distribute unit trust schemes.
Some financial planners have two types of licences and can provide more comprehensive service.
Financial planning firm
A FAR or LFP has to be attached with a firm. The financial planning firm holds the master licences, namely Financial Adviser licence (from BNM for insurance matters) and Capital Market Service Licence (from SC for investment matters). A financial planning firm is also registered with FIMM and authorised to market and distribute unit trust schemes of different fund houses.
Where to check if the financial planner is registered
To check if someone claiming to be a financial planner is licensed, you may go to the following sites:
1. BNM (Link)
You have to download the List of Financial Adviser’s Representatives. This list is last updated at 31 December 2023. You have to search for the adviser’s name in this PDF. If the name does not appear here, it is likely that the adviser is not registered. But there is a possibility that the adviser has registered after the list is updated.
2. Securities Commission Public Register of Licence Holders and Registered Persons (Link)
Here you can search for LFP. You can enter the name of the financial planner and see if he/she has a valid licence. This list is updated quite frequently, so the name of a licensed financial planner should appear here.
3. Association of Financial Advisers (Link)
This is a place where you can search for both Licensed Financial Planner and Registered Financial Adviser Representative. However, as at the time of writing, this page is not ready yet.
4. FIMM (Link)
This is the place to check whether your adviser is registered to sell unit trusts. This is only applicable to LFP who markets unit trusts to clients.
Conclusion
Now you know how to verify a financial planner. Not everyone who claims to be a financial planner/adviser is a legit professional. Make sure that you only deal with a registered or licensed person to avoid being scammed.
I only have the CMSRL, thus would not be able to provide insurance solutions to you. Nonetheless, I could refer you to my colleagues who are FAR if you have protection need. If you want to work with me to improve your finances, just leave your details by clicking the button below. I will reach out to you and see if we are a good fit for each other.
Disclaimer: This post is for informational purpose only. You should use judgment and conduct due diligence before taking any action or implementing any plan suggested or recommended in this article.
